It's a seller's market: Survey
Friday 15 June 2012
New Zealand’s real estate market appears to be favouring sellers for the first time in years, according to the latest BNZ/REINZ residential market survey.
By Susan Edmunds
With investors returning to the market and more first-time buyers looking for homes, the shortage of listings is igniting competition for available properties.
It comes on the back of several reports that say low interest rates and global economic turmoil are spurring people into property investment.
BNZ chief economist Tony Alexander said it did not come as a surprise. “I’ve just been at Fieldays the past few days and had people coming up to me saying ‘I’ve saved this much for my retirement, where am I going to put it?’”
He said the prospect of low interest rates for the next few years meant investors would go in search of better yields. “There will be a wave of investors hitting the market.”
A net 27% of real estate agents reported they had noticed more investors in the market, compared to 19% last month and 4% a year ago. In addition, 41% of agents said more first-home buyers were entering the market.
And the market appears to be moving in sellers’ favour: A record 15% of agents reported that they felt buyers were more motivated than sellers.
“For the first time since our survey started we feel one can say with strong confidence that the NZ market has shifted toward being a seller’s market rather than the buyer’s market which has been more the norm for the past four years,” the report said.
Real Estate Institute of New Zealand figures for May showed auctions were finding favour with more sellers, particularly in Auckland,. Slightly more agents than the survey’s average, 15%, reported that their auction clearance rates were improving.
The survey found that 64% of agents thought prices were rising.
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Coastal suburbs dominate Barfoot & Thompson’s latest list of Auckland’s top 20 hot growth spots, indicating a shift away from the traditional inner-city favourites.
Commercial property investments carry more risk than residential investments and this means that getting finance for them is a far more intricate process.
Here is what Reserve Bank governor Graeme Wheeler had to say about interest rates today.